1997 Minnesota Statutes

     336.9-115 Investment property. 

    (1) In this article:  

    (a) "Commodity account" means an account maintained by a 
 commodity intermediary in which a commodity contract is carried 
 for a commodity customer. 

    (b) "Commodity contract" means a commodity futures 
 contract, an option on a commodity futures contract, a commodity 
 option, or other contract that, in each case, is:  

    (i) traded on or subject to the rules of a board of trade 
 that has been designated as a contract market for such a 
 contract pursuant to the federal commodities laws; or 

    (ii) traded on a foreign commodity board of trade, 
 exchange, or market, and is carried on the books of a commodity 
 intermediary for a commodity customer. 

    (c) "Commodity customer" means a person for whom a 
 commodity intermediary carries a commodity contract on its books.

    (d) "Commodity intermediary" means:  

    (i) a person who is registered as a futures commission 
 merchant under the federal commodities laws; or 

    (ii) a person who in the ordinary course of its business 
 provides clearance or settlement services for a board of trade 
 that has been designated as a contract market pursuant to the 
 federal commodities laws.  

    (e) "Control" with respect to a certificated security, 
 uncertificated security, or security entitlement has the meaning 
 specified in section 336.8-106.  A secured party has control 
 over a commodity contract if, by agreement among the commodity 
 customer, the commodity intermediary, and the secured party, the 
 commodity intermediary has agreed that it will apply any value 
 distributed on account of the commodity contract as directed by 
 the secured party without further consent by the commodity 
 customer.  If a commodity customer grants a security interest in 
 a commodity contract to its own commodity intermediary, the 
 commodity intermediary as secured party has control.  A secured 
 party has control over a securities account or commodity account 
 if the secured party has control over all security entitlements 
 or commodity contracts carried in the securities account or 
 commodity account.  

    (f) "Investment property" means:  

    (i) a security, whether certificated or uncertificated; 

    (ii) a security entitlement; 

    (iii) a securities account; 

    (iv) a commodity contract; or 

    (v) a commodity account.  

    (2) Attachment or perfection of a security interest in a 
 securities account is also attachment or perfection of a 
 security interest in all security entitlements carried in the 
 securities account.  Attachment or perfection of a security 
 interest in a commodity account is also attachment or perfection 
 of a security interest in all commodity contracts carried in the 
 commodity account.  

    (3) A description of collateral in a security agreement or 
 financing statement is sufficient to create or perfect a 
 security interest in a certificated security, uncertificated 
 security, security entitlement, securities account, commodity 
 contract, or commodity account whether it describes the 
 collateral by those terms, or as investment property, or by 
 description of the underlying security, financial asset, or 
 commodity contract.  A description of investment property 
 collateral in a security agreement or financing statement is 
 sufficient if it identifies the collateral by specific listing, 
 by category, by quantity, by a computational or allocational 
 formula or procedure, or by any other method, if the identity of 
 the collateral is objectively determinable.  

    (4) Perfection of a security interest in investment 
 property is governed by the following rules:  

    (a) A security interest in investment property may be 
 perfected by control.  

    (b) Except as otherwise provided in paragraphs (c) and (d), 
 a security interest in investment property may be perfected by 
 filing.  

    (c) If the debtor is a broker or securities intermediary, a 
 security interest in investment property is perfected when it 
 attaches.  The filing of a financing statement with respect to a 
 security interest in investment property granted by a broker or 
 securities intermediary has no effect for purposes of perfection 
 or priority with respect to that security interest.  

    (d) If a debtor is a commodity intermediary, a security 
 interest in a commodity contract or a commodity account is 
 perfected when it attaches.  The filing of a financing statement 
 with respect to a security interest in a commodity contract or a 
 commodity account granted by a commodity intermediary has no 
 effect for purposes of perfection or priority with respect to 
 that security interest.  

    (5) Priority between conflicting security interests in the 
 same investment property is governed by the following rules: 

    (a) A security interest of a secured party who has control 
 over investment property has priority over a security interest 
 of a secured party who does not have control over the investment 
 property.  

    (b) Except as otherwise provided in paragraphs (c) and (d), 
 conflicting security interests of secured parties each of whom 
 has control rank equally.  

    (c) Except as otherwise agreed by the securities 
 intermediary, a security interest in a security entitlement or a 
 securities account granted to the debtor's own securities 
 intermediary has priority over any security interest granted by 
 the debtor to another secured party.  

    (d) Except as otherwise agreed by the commodity 
 intermediary, a security interest in a commodity contract or a 
 commodity account granted to the debtor's own commodity 
 intermediary has priority over any security interest granted by 
 the debtor to another secured party. 

    (e) Conflicting security interests granted by a broker, a 
 securities intermediary, or a commodity intermediary which are 
 perfected without control rank equally.  

    (f) In all other cases, priority between conflicting 
 security interests in investment property is governed by section 
 336.9-312(5), (6), and (7).  Section 336.9-312(4) does not apply 
 to investment property.  

    (6) If a security certificate in registered form is 
 delivered to a secured party pursuant to agreement, a written 
 security agreement is not required for attachment or 
 enforceability of the security interest, delivery suffices for 
 perfection of the security interest, and the security interest 
 has priority over a conflicting security interest perfected by 
 means other than control, even if a necessary endorsement is 
 lacking. 

    HIST: 1995 c 194 art 2 s 4